Print Page   |   Contact Us   |   Sign In   |   Register
The Taxman Cometh... Progressive Tax Rates
Share |

In spite of all the noise made by politicians and the media… for the most part we are taxed the same way. On earned income, that is.

Let us explain.

  1. You pay no federal income taxes on your first dollars earned. These are sheltered by your personal exemption—or exemptions if you are married or have children.
  1. Your next dollars earned are also sheltered from taxes by the greater of your standard deduction or itemized deductions.
  1. After that your earnings are taxed at 10%. The amount of dollars taxed at this level is determined by your filing status: Single, Married filing Jointly, Married filing Separately, Head of Household or Qualifying Widow(er).
  1. When your earnings exceed the 10% marginal tax bracket, the next dollars are taxed at 15%
  1. then 25%
  1. then 28%
  1. then 33%
  1. then 35%
  1. and finally 39.6%

It’s true that the highest income earnings may have their personal exemptions and itemized deductions "phased out” and many tax payers are subject to Alternative Minimum Tax.

<NEXT: All Income is NOT taxed the same>

Search
Sign In
Sign In securely
Home

My Plan

Join a Group

ADV Part II


F.A.Q.

Blogs

 

Where should I save?

 Where should I invest?